Puerto Princesa City Mayor Lucilo R. Bayron has directed all City Department Heads with National Government Devolved Services to prepare for the implementation of Supreme Court Ruling on Mandanas case, as all local government units (LGUs) in the country are expected to absorb national government programs starting 2022 and expanded its share in Internal Revenue Allotments (IRA).
The Department of Budget and Management (DBM) has estimated that highly urbanized cities like Puerto Princesa City would have an increase in IRA share of about P394 million to P2.13 billion by next year.
Because of this, the budget next year for Puerto Princesa City is estimated at P 4.4 Billion.
In his Memorandum Circular No. 11, mayor Bayron told the Local Finance Committee and all City Department Heads with National Government Devolved Services to make the necessary preparations since this will take effect next year, 2022.
“The Supreme Court ruling in the case of Mandanas et. al. vs. Ochoa broadened the base of the computation of the LGUs share in the national revenues, now referred to as the National Tax Allocation (NaTA) beginning FY 2022. LGUs are therefore expected to be responsible for the funding and delivery of government services devolved to them under RA 7160 and other subsequent related laws,” the Memorandum Circular reads.
Mayor Bayron has also advised the City Department Heads to confer and coordinate with line national/ regional government agencies “for the delineation of expenditure assignments and services that shall be set across levels of government and determine subsequent implications of assumption of devolved functions and responsibilities on your present organizational structure,”.
The Supreme Court granted in 2018 and reaffirmed in 2019 the petitions of Batangas Gov. Hermilando Mandanas and former Bataan Gov. Enrique Garcia Jr., under which the LGU’s IRA would come from 40 percent of collections of all national taxes—the Bureau of Internal Revenue’s (BIR) tax take plus the Bureau of Customs (BOC) collections of import duties and other taxes. At present, LGU’s IRA only came from two-fifths of national internal revenue taxes collected by the BIR.
The DBM has earlier announced that with the implementation of the SC ruling on Mandanas case, “the LGUs, therefore, must prepare themselves to effectively assume new responsibilities. The LGUs and the National Government must plan and prepare for the seamless transfer of devolved functions, services, and facilities,”. As the bigger IRA would slice a bigger portion of the P5.02-trillion national budget proposal for 2022, the DBM said the functions to be devolved “must permanently be taken out from national government agencies to empower LGUs to assume them.”